Strategy (MSTR) Stock Plummets 7.0% Amid MSCI Index Review
Strategy (MSTR), formerly known as MicroStrategy, has seen its stock plummet by 7.0% following MSCI's reopening of a review that could see the company excluded from key global indexes.
The review is focused on Strategy's eligibility to remain in the index due to its large unrealized Bitcoin losses and reliance on capital markets to fund its sizable preferred dividend obligations.
Strategy has been selling both Bitcoin and common stock to meet its approximately $1.2 billion annual preferred dividend commitments, highlighting how dependent the company's story is on access to capital markets, not operating cash flow.
If MSCI ultimately reclassifies Strategy as a non-operating entity, it could accelerate forced selling by index-linked holders and increase volatility around any future Bitcoin or equity issuance.